ED launches money laundering probe against Zee founder Subhash Chandra in alleged Rs 1,322 crore LIC Housing Finance fraud

The Enforcement Directorate (ED) has registered a money laundering case against Zee founder and Essel Group chairman Subhash Chandra in connection with an alleged loan fraud involving Life Insurance Corporation Housing Finance Limited (LICHFL), which reportedly suffered losses of Rs 1,322 crore.

Officials said the investigation has been initiated under the Prevention of Money Laundering Act (PMLA), based on a First Information Report (FIR) registered by the Central Bureau of Investigation (CBI). Chandra is accused of allegedly submitting inflated net-worth certificates to secure loans for companies associated with the Essel Group, which subsequently defaulted on repayments.

The allegations relate to two loan facilities worth a combined Rs 980 crore sanctioned in 2018. LICHFL has pegged its alleged wrongful loss at more than Rs 1,322 crore, including outstanding dues, interest and other charges.

How the alleged loan fraud unfolded

According to the complaint filed by LICHFL with the CBI, two loan facilities were sanctioned to four companies associated with the Essel Group.

The first facility of Rs 500 crore was extended to Vasant Sagar Properties Pvt Ltd, with Pan India Infra Projects Pvt Ltd as the co-borrower. The second facility, worth Rs 480 crore, was sanctioned to Digital Subscriber Management and Consultancy Services Pvt Ltd, with Spirit Infra Power and Multi Ventures Pvt Ltd as the co-borrower.

The lender alleged that the loans were secured on the basis of personal guarantees provided by Chandra and net-worth certificates that substantially overstated his financial position.

According to the complaint, a certificate issued by DJM and Co on March 28, 2018, valued Chandra’s net worth at approximately Rs 59,113 crore as of March 31, 2017. Another certificate, issued by MPJ and Co on July 6, 2018, reportedly placed his net worth at Rs 40,562 crore.

LICHFL alleged that these financial declarations played a role in securing the loan facilities and that both accounts subsequently slipped into default.

CBI registered FIR against Chandra and others

The CBI registered an FIR on August 31, 2026, following a written complaint by Neeta Menghani, general manager of LICHFL.

Apart from Chandra, the FIR names the four borrower and co-borrower companies, their directors and other unidentified persons, including public servants.

The complaint alleges that Chandra, in collusion with the borrower companies and their officials, induced LICHFL to sanction and disburse the loans through allegedly false and inflated financial documents.

It also raises allegations of misappropriation and misapplication of loan funds, resulting in losses to the housing finance company.

The CBI is examining the circumstances surrounding the sanctioning of the loans, the documents submitted to secure them and the subsequent defaults. The ED’s investigation will focus on the alleged money laundering angle arising from the underlying case.

Chandra’s net-worth claims under scrutiny

An important aspect of the case concerns the discrepancy between the net-worth figures submitted to LICHFL in 2018 and Chandra’s subsequent statements during personal insolvency proceedings.

According to the CBI complaint, Chandra reportedly disputed the financial figures reflected in the certificates submitted to the lender. During insolvency proceedings, he stated that his net worth in 2024 was Rs 31.79 crore and that it had not exceeded Rs 40,000 crore during 2017-18.

The CBI is examining the alleged discrepancies and whether the documents were used to induce LICHFL into approving the loans.

Zee Entertainment responds to ED action

Following the development, a spokesperson for Zee Entertainment Enterprises Ltd clarified that the ED proceedings concern Chandra in his personal capacity and certain promoter entities.

“The company would like to state that the matters pertain to Dr Subhash Chandra and the promoter entities and have no bearing on ‘Z’ or its operations in any manner,” the spokesperson said.

A separate response from Chandra on the latest ED investigation was awaited.

Personal insolvency proceedings add to Chandra’s financial troubles

The latest investigation comes amid separate personal insolvency proceedings involving Chandra and claims by creditors against his personal estate.

The National Company Law Tribunal (NCLT) had approved a repayment plan under which creditors would reportedly recover around Rs 6.25 crore against admitted claims of approximately Rs 22,006 crore. The plan was challenged by dissenting creditors, including LICHFL, before the National Company Law Appellate Tribunal (NCLAT).

LICHFL was among the lenders opposing the proposed recovery arrangement, given the substantial gap between the amount claimed and the proposed repayment.

The ED’s latest action marks another development in the financial investigations involving Chandra and companies associated with the Essel Group. The investigation will now examine the alleged diversion or misuse of loan funds and whether any proceeds of the alleged offence were involved in money laundering.